Proposed city budget excludes HHS2 funding due to pandemic economic impacts

The+building+site+for+HHS2+is+located+between+South+Main+Street+and+Interstate+81.

Maya Waid

The building site for HHS2 is located between South Main Street and Interstate 81.

After halting the construction of HHS2 at the start of the coronavirus pandemic, the Harrisonburg City Council and School Board set a goal to resume the building of Harrisonburg’s second high school in June 2021. However, at the April 13 City Council Meeting, City Manager Eric Campbell’s proposed budget for the 2021-2022 fiscal year did not include any funding to restart construction of HHS2. Campbell explained the reasoning for this, citing the pandemic’s economic effects such as unemployment rates and declining tax revenue.

“When approved by City Council in December 2019, it was understood that the project will precipitate the need for a multi-year real estate tax increase to fund the project. However, the economic impact of the pandemic on the community and the volatility in the bond market required the project to be suspended. The city’s fragile economic environment still has not made it prudent to move forward with the project at this time,” Campbell said during the meeting.

When the new high school was approved in 2019, a 14-cent real estate tax increase was established to fund the construction. According to Mayor Deanna Reed during the City-School Liaison Committee Meeting, she cannot justify that tax increase to fund the new high school at this time. 

“If [the new high school] is going to increase taxes on our citizens right now, that’s an issue. I have families that are still trying to survive, and I cannot say that my families that I serve can afford to have a tax increase on them right now at this moment,” Reed said. 

The Harrisonburg City Meals Tax Revenue experienced a 24.5% decline ($3.5 million), and the Lodging Tax Revenue experienced a 42.5% decline ($1.4 million) with the pandemic. The city has benchmarks in place regarding these revenues and other factors that signify when they will resume funding of the second high school. These were detailed during the April 13 City-School Liaison Committee meeting, and they include: 

  1. Governor Northam rescinding his pandemic-related Executive Orders that regard social gatherings and building capacity numbers. 
  2. Six consecutive months of revenue from the Meals Tax at or above 90% of pre-pandemic levels.
  3. Six consecutive months of revenue from the Lodging Tax at or above 90% of pre-pandemic levels.
  4. Six months of employment at or above 85% of pre-pandemic levels for the Harrisonburg-Rockingham MSA.

Upon hearing the benchmarks set by the city, Harrisonburg City Public Schools (HCPS) Superintendent Dr. Michael Richards proposed the idea of directing federal funding from the American Rescue Plan toward construction. According to Richards, HCPS will be receiving around $12 million from the federal government, 80% of which could go toward HHS2. The other 20% would be used for learning loss compensation. 

“I know that our contractor, Nielsen [Builders], could do a year of work with that [federal] money,” Richards said during the City-School Liaison Committee Meeting.  

The City-School Liaison Committee expressed interest in potentially looking into these federal funds as a possibility to build the second high school, but there will be no real-estate tax increase for this purpose. Thus, unless the federal funds are approved to be used for this purpose, construction on HHS2 will resume when the four benchmarks are met.

Print Friendly, PDF & Email